Home Purchase Mortgage
There are many types of purchase mortgages.
Conventional
Conventional loans are the most common type of mortgages, and are issued through banks and other mortgage lenders. They typically require a 20% downpayment to avoid extra fees, and can be fixed or adjustable rate. Loans that are at or below the limits set by Fannie Mae and Freddie Mac are known as conforming loans.
FHA
FHA loans are secured by the Federal Housing Administration and are generally reserved for first-time homebuyers. FHA loans can require as little as 3.5% in downpayment funds, but there are often fees associated with FHA loans that are not present with conventional loans.
Jumbo
Jumbo mortgages are similar to conventional loans. They are also issued through banks and mortgage lenders, and also typically require a 20% downpayment to avoid extra fees. However, jumbo loans differ in that they are for an amount above the limits set by Fannie Mae and Freddie Mac. In most of the Bay Area, that limit is $765,600.
VA
VA loans are backed by the Department of Veterans Affairs and are available for active duty personnel and veterans of the United States military. VA loans can require no downpayment and can have attractive terms, making homes available to more of our nation’s military.